ECONOMY

Croatia could get a third cell phone operator in June

ZAGREB – Croatia is likely to get a third mobile phone operator through an international tender by the end of June, a source at the State Telecoms Council said yesterday. Croatia’s mobile market, with penetration of around 55 percent, is now shared between national operator HT, majority-owned by Deutsche Telecom, and VIPnet, owned by Austria’s Mobilkom. «I cannot give exact dates, but I expect the tender could be ready by the end of April. Then we would have up to two months to choose the third operator,» the source said. Croatia is setting up a new telecommunications regulatory agency that would succeed the current council, but the source said this should not slow down the tender as the council would remain in charge until the new agency has been established. The new operator will also be able to get a UMTS license. Three foreign and one domestic firm expressed interest last year in becoming the third GSM operator in the former Yugoslav republic’s market of 4.4 million people, the State Telecoms Council has said. Their names were not revealed but local media speculated they could include mobile phone giant Vodafone, Greece’s OTE, Turkish Rumeli, Norwegian Telenor and Monaco Telecom International. The two incumbent operators said they were ready for a third operator but voiced doubt about the profitability of its business, given the relatively small and saturated market. According to the regulations, the two operators will have to provide national roaming to the third operator at an agreed price during the first three years. Croatia also wants to get a second fixed-line operator soon and has decided to lower the initial fee for obtaining the license to up to 8 million kuna instead of the current price of 40 million kuna. «We think competition is good for consumers and that is why we decided to cut the fee,» Transport Minister Bozidar Kalmeta told the local Dnevnik daily. The sole provider, HT, lost its monopoly on January 1, 2003, but is not obliged to provide potential rivals with access to local exchanges before January 1, 2005. There is no competitive tender to award a license for fixed telephony, and a source in the Transport Ministry said a new regulation, besides cutting the initial fee, also dropped the new operator’s obligation to invest 50 million euros ($61.6 million) in developing its own network within four years. The previous center-left Cabinet revoked a license granted last year to US-Croatian consortium Divan, citing procedural irregularities. Divan has sued the Transport Ministry and the case is still pending.